Sioux Falls can bank on Morrell for at least 10 years

South Dakota State Roundup

For the next 10 years Sioux Falls and South Dakota can count on 2,800
direct jobs, a $75 million payroll and $121 million pumped into the economy
by John Morrell & Co.

When Morrell's parent company Chiquita Brands hinted in December 1992
that it might sell or close the plant if a buyer couldn't be found, a
firm agreement with the company became essential, says Dave O'Hara, commissioner
of the Governor's Office of Economic Development. And South Dakota financial
and political forces went to work in earnest to assure continued plant
operations.

Morrell will now remain open as a result of the following agreements.

From the state:

$1 million per year over 10 years to help Morrell repay loans associated
with the plant's upgrade.

$0.5 million in training funds and $0.5 million in energy conservation
funds.

$0.5 million to improve the plant's waste water treatment facility.

From the city of Sioux Falls:

$45,000 annual savings on city water rates.

$450,000 property tax break on the value of plant improvements.

From Northern States Power Co.:

a 20 percent annual savings in energy costs over the next 10 years.

And, finally, Morrell is negotiating with a group of Sioux Falls banks
for a $30 million plant improvement loan.

According to O'Hara, the financial incentives are worthwhile. "The money
spent chasing new companies would easily be 10 times greater to get a
similar economic impact as we're getting from helping Morrell." And the
Legislature approved the assistance package because it is in the state's
best interest to keep the plant open, O'Hara adds: $5 million direct and
indirect sales tax revenue goes to the state annually.

"Morrell has a tremendous impact not only on the employees and suppliers,"
says Jim Holderread, president of the Sioux Falls Development Foundation,
"It's the largest value-added processor in the state." Holderread adds
that Morrell provides a ready market for hogs, which don't weigh in as
well if they must travel to a more distant market. "It's a dollar and
cents issue with farmers."